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Impala Platinum has come out with positive earnings and its price continues to move higher, in what is a very solid uptrend. The good news is there are still significantly higher levels to come.
Implats – More upside to come
Recommendation: MEDIUM-TERM HOLD/TRADERS BUY
Current Trend: Up on all main timeframes.
Chart Setup: Implats is continuing higher, and really accelerating on Thursday after reporting a turnaround in earnings. It is in a very strong trend and has a higher target from an inverse head and shoulders pattern (as labelled).
- It also formed a rounding bottom (labelled), which points to further upside to come.
- It short-term Stochastic (on top) is currently making lower highs, unlike the price, and this implies a correction (albeit temporary) is likely at any time.
Strategy Details: It remains a medium-term hold (i.e. months). If not in, buy on a pullback towards R55. As mentioned in recent weeks and months, there is huge upside potential in platinum stocks still.
Target: The rounding bottom is targeting line 2 initially at R71. While its further target is R88, based on the height of the inverse head and shoulders pattern, projected up. (There is also a shorter-term target of R67). One can take some profits at each level.
Stop-loss: It depends on your time horizon. For the medium-term it’s a close below R41. For short-term traders it’s a close below R50. (Personally I would like to give it more wiggle room, due to its large med-term upside potential).
(Daily chart)
- Colin Abrams is an independent technical analyst. To subscribe to more recommendations by the author, or attend trading courses, please go to www.themarket.co.za
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